When an S Corporation Distributes Appreciated Property to Its Shareholders

question 114

True/False

When an S corporation distributes appreciated property to its shareholders, the S corporation recognizes gain as though it had sold the appreciated property for its fair market value just prior to the distribution.

---

Definitions:

Feasible Solutions

Solutions that meet all the constraints of a particular problem, considered acceptable and implementable.

Constraint Lines

Lines in a graph of a linear programming model representing limitations or restrictions on the resources available.

Contribution Margin

The amount of revenue from sales that exceeds the variable costs associated with producing a product or service.

Production Constraint

Limitations or restrictions in the production process that prevent a company from reaching its full production potential.